Mumtalakat group reports net profit of BD28.7 million

Manama: Bahrain Mumtalakat Holding Company’s (“Mumtalakat” or the “Company”), the investment arm of Bahrain, Board of Directors yesterday announced the Company’s consolidated financial results for the year ended December, 31, 2015.

The results reflect continued solid financial and operational performance across Mumtalakat’s group of companies (“Group”), and demonstrate the strength and resilience of the Company’s investment model and the capability of its team.

During the period, operating income increased to BD124.4 million (US$ 330.9m) largely as a result of better operating performance from Gulf Air, which saw a decrease of 53 per cent in operating losses for the year.

The Group registered a net profit of BD 28.7m (US$ 76.3m), compared to BD 91.6m (US$ 243.6 m) in the previous year. The reduction in the net profit is attributed to impairment losses recognised on goodwill that was partially offset by an increase in share of profit from associates and improved operational performance of Gulf Air.

Commenting on the results, Mumtalakat’s Chief Executive Officer, Mahmood Hashim Alkooheji, said: “We are very happy to report strong profits for the third consecutive year, with significant improvements to the Company’s financial position and the recording of positive retained earnings of BD 9.2 m (US$ 24.5 m).”

In 2015, Mumtalakat announced a number of important local investments with leading international businesses in the industrial & manufacturing and the real estate & tourism sectors.

These include the planned development of a wheel manufacturing facility with Synergies Castings Limited and the planned development of a copper tube manufacturing facility with Mueller Industries and Cayan Ventures.

Mumtalakat also announced the planned development of a 215-room luxury resort with Fairmont Resorts & Hotels, through its real estate arm, Bahrain Real Estate Investment (“Edamah”). These investments will collectively generate approximately 1500 new jobs and make a positive contribution to the domestic economy.

Furthermore, as part of its geographic diversification efforts, Mumtalakat acquired a significant minority stake in Nobel Learnings, a leading provider of pre-school to high school education based in the US. This acquisition is aligned with Mumtalakat’s approach to invest in companies with strong growth potential looking for a value adding, long-term partner.

Mumtalakat is recognised as one of the world’s most transparent sovereign wealth funds, and in 2015, it received a rating of 10 out of 10 in the Linaburg-Maduell Transparency Index, the most influential benchmarks in measuring the transparency of sovereign wealth funds.

Throughout the year, Mumtalakat remained well positioned in terms of liquidity. In December 2014, the company signed a USD 500 m Unsecured Revolving Credit Facility. The Facility was structured as a 5-year Revolving Credit Facility and was fully utilised in 2015 to refinance existing debt. 

Its consolidated revenues for 2015 were BD 1.168 billion (US$ 3.106 bn), which is 4pc lower compared to 2014, primarily due to lower LME aluminium prices affecting Alba.

Gulf Air’s net profit after government grants and write back of provisions and payables increased significantly to BD 66.4 m (US$176.6 m) compared to BD 15.8 m (US$ 42 m) in the prior year.

Gulf Air has also reduced its operating losses by 53pc to BD 31.1 m (US$ 82.7 m), compared to BD 65.6 m (US$ 174.5 m) in 2014, as a result of improved cost controls and operating efficiencies.